Tel Aviv was ranked fifth in Startup Genome’s Global Startup Ecosystem Ranking 2023, climbing two positions from seven, despite a challenging year for the tech industry worldwide.
The City, also holds its place as second in the world for Cleantech ecosystem, reaching this ranking in Startup Genome’s 2022 report for the first time since 2012. According to the data, Tel Aviv boasts one start up for every 154 residents.
Declared as “one of the most resilient tech hubs in Europe, the Middle East and Africa – more resilient than London and Stockholm”, Tel Aviv experienced direct year-on-year growth across key categories in 2022; Seed investments grew by 10% compared to 2021, and the ecosystem saw two $1+ billion exits in 2022, including AI-based Fintech Pagaya’s $8.5 billion IPO.
Cybersecurity is a major part of Tel Aviv’s ecosystem, with cybersecurity start-ups raising $1.7 billion, constituting almost 20% of total venture capital investments in 2022, and placing the city in third place in the world for cybersecurity investments, behind only the Bay Area and New York, and ahead of London and Beijing.
Tel Aviv start-ups are worth a combined $393 billion, representing 3.5-times growth since 2018, the second fastest growth in the world.
Tel Aviv is also home to the fifth-highest number of unicorns worldwide, boasting 95 unicorns as of 2022 of which 75 became unicorns since 2018, according to the report.
Findings of the report showed that many Tel Aviv-headquartered and -founded unicorns, such as Iron Source and Gett, have been breeding new entrepreneurial talent, as staff alumni leave to found more start-ups in Tel Aviv and abroad, with 76% choosing to stay and build their businesses in Tel Aviv. For every unicorn Tel Aviv produces, more than four additional start-ups are founded by people from billion-dollar companies, also known as second-generation founded start-ups.
A national plan for developing human capital in high-tech was approved in September 2022 by the Knesset. A pilot project is underway prioritising under-represented populations. The Government also has a goal of adding 4,500 personnel from the Arab sector, 2,500 from the ultra-orthodox sector, and for 45% of trainees to be women.
